Feasibility of domestic policies transitioning to ETS for ITMOs

Art 6 of the Paris Agreement foresees in the International Transfer of Mitigation Outcomes (ITMOs), allowing countries to jointly fulfill their national contributions (NDCs). Market-based mechanism, and especially cap-and-trade systems are the easiest way to do this in terms of environmental integirty and accounting.

The project analysed domestic policies that can over time transition into an ETS, so they can be used as ITMOs. This includes e.g. climate policies such as CO2 performance standards and carbon taxes, but also energy policies such as portfolio standards, energy efficiency standards, feed-in tariffs and green and white certificate schemes.

For this, the project looked at policy instrument commonalities and how they are operationalised for main policies for a selected group of countries. Such commonalities include scope, target group, ambition levell, effort sharing, institutions, incentivisation, monitoring of progress and enforcement.

The project also looked at the possible co-existence of domestic policies with ETS, assessing overlaps, duplications and synergies.